Calling in the Home Pro

Poor Cousin Roy. He sure loves a bargain, and he couldn’t wait to show this one off to me. He just bought a property, he said, that would be perfect for a big family. It’s got a sparkling pool! A gourmet kitchen! Four huge bedrooms, and three updated bathrooms!

I was skeptical, because I’ve seen some of Roy’s “bargains” before. But, what the heck, I had some free time, so I was willing to take a look. Maybe I could be helpful.

Well, it turns out the pool wasn’t exactly sparkling, unless you count the sun’s reflection off the black, oily sludge at the bottom. And the bedrooms were huge only if you’re a gerbil. The kitchen had all the extras, all right: a battered old garbage disposal sitting on the floor, a vintage double oven in trendy harvest gold, and – well, who really needs a faucet, anyway? And let’s not talk about the bathrooms. Ever. To anyone.

Now, my readers already know that this is the kind of property I love, because I can make a ton of money on it. But it takes careful due diligence to make sure it’s going to be profitable, and I was pretty sure cousin Roy didn’t even know where to begin.

I asked what the renovation would cost. Roy smiled with confidence. “Exactly $2,542.69,” he said. “See, I found this Internet article on how to renovate a kitchen for under $500. Then, I figure around $1,000 for wood floors. Oh, and $542.69 to put in a new roof. I already figured out the cost of the shingles and everything! You know, I’m doing the work myself.”

“Okay,” I said, weakly. “What kind of roof did you decide on?”

“Green,” Roy said brightly. And it just went downhill from there.

Roy was right about one thing: It is possible to estimate the cost of repairs and renovations. That’s one of the things I teach in my courses and it’s an essential skill for making quick decisions about which properties to buy. But those estimates have to be based on facts, not guesses. And at some point, you and your contractor will have to come up with some real numbers.

This is why I’m so happy to live in the age of the Internet, with so many great tools for investors and contractors. One of my favorites is Home Builder Pro Calcs, developed by Double Dog Studios. This app, which is available for both iOS and Android, has hundreds of calculators you can use for renovations. Putting up a roof? With just a little bit of information, you can figure out in seconds how many shingles, rolls of felt, and even how many roofing nails to buy. Need insulation? Enter your attic dimensions and the weather zone you live in, and you’ll know what kind to buy, and how much. Need to figure out how tall a tree is? How powerful an HVAC system you need? This app will even tell you how long it will take to fill up that grungy swimming pool.

And it’s easy to use, too, so you don’t need to be a contractor to make sense of it. The calculators are organized by subject: electric, plumbing, floors, and roof, for example. In addition to calculators, Home Builder Pro has some really helpful educational guides, like a chart that explains lumber grades, and a pretty good glossary of construction terms. It’s very handy.

Now, don’t get me wrong. An application like this will only help you if you’re willing to put in realistic numbers. As computer gurus used to say, “garbage in, garbage out.” Wishful thinking will get you nowhere. But good data and careful planning can turn a turkey of a house into an eagle.

Hopefully, even cousin Roy will understand this someday. Until then, though, I’ll do my own due diligence. And I’m still not talking about those bathrooms.

Don DeRosa is recognized as one of the nation’s top 21 real estate investors in the New York Times bestseller “The Millionaire Real Estate Investor”. Don, who is a full-time investor, trainer, and mentor, is the first to offer his complete investing system on a mobile platform. Don teaches investors how to Make More and Work Less by being more efficient, productive and competitive, leveraging mobile technology and apps on the iPad, iPhone, Android and other mobile devices.